Boeing Co. agreed on Sunday to acquire Spirit AeroSystems Holdings Inc. for $37.25 per share in an all-stock deal, valuing the company at $4.7 billion, according to sources familiar with the transaction.
As part of the deal, Boeing will also assume approximately $3.5 billion of Spirit’s debt. The transaction is expected to be announced as early as Monday, said the sources, who requested anonymity prior to the public announcement. Reuters had reported the per-share price earlier on Sunday. Representatives for both companies declined to comment.
Two of the sources stated that Boeing plans to take control of Spirit’s manufacturing operations that support its commercial jet lineup, including the production of frames for its key 737 Max aircraft. Boeing will also gain control over some of Spirit’s defense contract work.
Additionally, Boeing’s competitor, Airbus SE, is anticipated to announce its takeover of certain Spirit factories that produce structures and components for its commercial aircraft. Terms for this transaction were not immediately available.
Boeing aims to reintegrate Spirit following an accident in January involving a 737 Max-9 airliner that exposed quality and manufacturing deficiencies at both Boeing and its crucial supplier, prompting a reevaluation of their relationship.
Spirit has been under increasing financial pressure and scrutiny alongside Boeing after a door-shaped panel on a 737 Max 9 model detached minutes after takeoff. Shipments of 737 fuselages have significantly decreased as Boeing intensifies its inspections in Kansas and near its headquarters in Seattle, rejecting aircraft structures with missing components or incomplete work.
This deal brings a key supplier for the 737, 787 Dreamliner, and other commercial jets back in-house for Boeing, which is currently experiencing financial strain from slowed production. Boeing reported a loss of approximately $4 billion in cash in the first quarter and is expected to lose a similar amount in the current quarter. The company’s credit rating is just one level above speculative grade, and management is eager to avoid falling into junk status.
The Wichita campus, responsible for producing most of the 737 airframes for Boeing and the nose sections of the 787 Dreamliners, has been at the center of several defects due to post-COVID workforce turnover. Reintegrating Spirit aims to help Boeing stabilize its supply chain and gain greater control over its aircraft production.
